Algernon Swinburne once said, "two deer, moose, or members of another antlered species who have a dispute they want to settle will face off, paw the ground, and charge at each other. Their antlers clash and often become enmeshed. They have locked horns."
Smaller animals on that ground can be trampled or can maneuver and strategize their location to avoid certain injury or death until a victor above is declared.
Our Lebanon is a tiny country with limited resources. It has a weak or nonexistent government and carries little gravitas on the regional or international scene. Yet it is in the eye of the storm of an unprecedented escalation in a wider regional conflict that draws the US and Iran into a lock horn.
That escalation seems to have followed what some see as a historic election in the US. Only a few years earlier, former US President Barack Obama’s administration had turned a blind eye to Iran and Hezbollah’s illicit financial activities to pave the way for the nuclear deal with the Islamic republic, an investigation by Politico has revealed. But then came President Donald Trump who revoked the agreement, restored and ramped up the sanctions and the financial embargo on Iran and its proxies in the region; and more ominously for Lebanon, aligned itself completely with what is seen as Israeli plans to contain Iran. Israeli military strikes are lately on a crescendo path against Syrian and Iranian military targets in Syria. It behooves Lebanon as a people and its leadership to contemplate a strategy to keep itself safe especially as all indications are that this lock horn will continue to escalate and could mature into victory or defeat in 2019. This seems to be the most opportune moment for the current Israeli and American leaderships as they both are unable to guarantee being in power beyond that moment.
There is no question that the internal Lebanese difficulties on the government formation or political front and on the front of the deplorable economic status are directly related to the above larger conflict. Much has been written and discussed on the political deadlock with no serious solutions in sight even if a government is formed tomorrow or if the lame duck current interim government is resurrected. And these tensions unfold against the backdrop of numerous reports by international financial institutions and rating agencies warning that Lebanon’s debt burden and fiscal deficit are unsustainable in the medium and long terms.
Most of these reports are based on a case scenario that does not take into account any acceleration in capital outflows that would further widen a significant deficit in the balance of payments and drain foreign currency reserves faster.
The reports were followed by downgrades of Lebanon’s sovereign credit rating and the ratings of several of its largest banks, amid a government paralysis that has left the country without a budget despite the urgent need to enact painful reforms to address the widening fiscal deficit and unlock billions of dollars in loans pledged by the international community.
The timing couldn't have been worse. The downgrades further undermine confidence in Lebanon's banking sector in the wake of recent civil lawsuits filed in New York against 11 Lebanese banks. The lawsuits claim banks provided material support to Hezbollah in the form of financial and banking services that facilitated the party’s "terrorist activities" in Iraq and elsewhere, resulting in the injuries of a number of plaintiffs and the death of their relatives.
While these lawsuits could prove baseless and be dismissed by the US courts, as the Association of Banks in Lebanon had noted, they could also spell trouble for Lebanon’s heavily dollarized economy.
For instance, if one of the lawsuits finds its way to court, any US correspondent bank could decide that the risks of dealing with its Lebanese counterparts outweigh the benefits of such a relationship, and decide to sever ties. Or even worse, any of the myriad of US agencies that oversee financial markets such as the Office of Foreign Assets Control, could see a case, and decide to further investigate any violations of US sanctions against Hezbollah, leading into a criminal case.
When the possibility of such scenarios is discussed, most Lebanese bankers are quick to dismiss them, mainly arguing that the recent civil lawsuits were either triggered by “ambulance chasers” or “politically motivated by the Israeli lobby with no legal basis.” Other bankers argue that top US officials have reassured their Lebanese counterparts of the US commitment to Lebanon’s financial stability and their satisfaction with the banking sector’s compliance with US sanctions and regulations.
However, the sweeping majority of Lebanese bankers and officials deliberately choose to ignore or fail to realise that nothing guarantees the validity of these assurances as times change and Hezbollah strengthens its grip over Lebanon's state institutions as demonstrated by the ongoing Cabinet formation negotiations.
In fact, US officials have reportedly suggested during recent visits to Beirut that US support for Lebanon is conditional on curbing Hezbollah’s influence in the government or at least ensuring that the Iranian-backed party doesn’t strengthen its grip over Lebanese institutions.
In other words, assuming that the US would refrain from taking any actions against Lebanon and that the West would protect our stability at all cost, is shortsighted. Our Foreign Minister Gebran Bassil should know better than to make such claims when he told CNN that “the world cannot allow to have a Lebanon that is collapsing,” while noting that “Lebanon could teach Washington and London how to run a country without a budget.”
Bassil’s father-in-law, President Michel Aoun, made the same assumption some 30 years ago though under different circumstances.
Aoun was confident the US and France would shield Lebanon against a complete Syrian takeover. But the wind didn't blow in Aoun's way. Bashar's father, Hafez Assad, joined the US-led coalition against Iraq's Saddam Hussein and secured a US green light for an offensive that drove Aoun out of the presidential palace after the latter refused to agree to the Saudi-Syrian brokered Taif Accord.
The repercussions were catastrophic for Lebanon and its people as over three decades of Syrian hegemony ensued while Aoun was forced into exile in France. Back then, our nation fell victim to a US-Syria rapprochement.
Today, Lebanon can ill afford a new disaster, this time being on the wrong side of the US.
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